Locking a month once its figures are reported
How a practice stops postings into a month it has already reported, from the closing checks to second approvers and corrections by reversal.
By Achekam · · 4 min read · For Financial services businesses in South Africa, Nigeria, Kenya
Once a month's figures have gone to the partners, a lender or a regulator, they should stay as reported. Yet in many small practices a supplier invoice dated last month, or a well-meant correcting journal, slips into a period everyone thought was finished. The next report opens from a different position, and nobody can explain why the numbers moved.
Closing a month in the books prevents that. This article covers what Achekam checks before a close, what a closed month refuses, and how to correct a reported month without reopening it.
Soft close, hard close and lock
Achekam lets a business soft-close, hard-close and lock a month. How you use the three is a policy decision for the practice, but two things are fixed by the system:
- a closed month refuses postings from every source;
- reopening a hard-closed month needs a second approver.
Write your policy down in a few lines: which state a month goes into when the bookkeeping is finished, which when its figures have been reported, and who may ask for a month to be reopened. The value of closing comes from everyone knowing the rule, not from the button.
Think about who relies on each month. For an advice practice the list is often longer than expected: the partners' monthly pack, a bank that asks for management accounts under a facility, the accountant preparing the annual financial statements, and sometimes a regulator or licence holder that asks for financial information. Each of them assumes that a month, once reported, stays as reported. Closing is how you make that assumption true.
What the screen checks before closing
Before a month is closed, the screen checks that the ledger balances and that nothing is left waiting: no posting suggestions, no unposted bills and no unmatched bank lines.
Read those checks as your month-end checklist. If any fails, the month is not ready:
- Posting suggestions waiting. Supplier invoices and receipts uploaded to Financial Intake become suggested postings, and only a person approves and posts them. Waiting suggestions usually mean documents nobody has reviewed yet.
- Unposted bills. A supplier bill without a purchase order waits for approval before it posts. These are bills still in someone's queue.
- Unmatched bank lines. The reconciliation is not finished. Each match is accepted by a person, and a reconciliation completes only when nothing is left unexplained.
Clear these first, then close. A month closed with work still waiting will need reopening, which defeats the point.
Every source refused in a closed month
Once a month is closed it refuses postings from every source. A manual journal dated in a closed month is refused, just as an unbalanced journal is always refused. The same applies to postings that would come from anywhere else in the system, such as invoices, bills or the bank.
In practice, the late supplier invoice dated last month cannot quietly land in it. Whoever enters it has to date the posting in an open month or ask for the closed month to be reopened, and that request is exactly the conversation you want to happen.
Reopening needs a second approver
Sometimes reopening is right. A material error turns up before anything was reported, or the accountant's year-end adjustments belong in the closed period. Reopening a hard-closed month needs a second approver, so one person cannot reopen a month, post to it and close it again without anyone else knowing. That is segregation of duties at work, and ACCA's overview of internal controls covers it alongside the control environment and the types of control a business can use.
Set out who may request a reopening, who may approve it, and that the reason is recorded in writing. If the month's figures went to a lender or a board, decide at the same time whether the report must be reissued.
Correcting by reversal in an open month
Most corrections need no reopening at all. A posted journal in Achekam is corrected only by a reversal, never by editing the original. When an error in a reported month comes to light, post the reversal and the correct entry in the current open month, with a narration that names the original entry and gives the reason.
The ledger then tells the true story. The reported month still shows what was reported; the current month shows the correction and why. The general ledger lists every posted line, and the trial balance can be run for all time, for a period or at a date and says whether debits equal credits, so anyone reviewing later can follow both entries.
| Situation | What to do |
|---|---|
| Error found before the month is reported | Fix it, then close |
| Error found after reporting, small or routine | Reverse and correct in the current open month |
| Error found after reporting, material to what was reported | Ask for a reopening, with a second approver, and consider reissuing the report |
| Late supplier invoice for a closed month | Post it in the current open month, unless the policy says otherwise |
A month-end close routine
- Review every posting suggestion and post or reject it.
- Approve or reject every waiting supplier bill.
- Finish the bank reconciliation for every account.
- Run the trial balance at month end and confirm it balances.
- Produce and send the month's reports.
- Close the month at the level your policy sets.
- Record any later correction as a reversal in the current month.
A month cannot close while receipts and bank lines are out of step, so the allocation habits in one client payment covering several invoices pay off here. The same principle applies to documents as to figures; see showing a filed document has not changed.
Pick the last month you reported, run the closing checks against it, and close it. From then on, make the close the final step of every month-end.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
